Saturday, March 28, 2009

He's just not getting paid, people. His salary is $191,000. By way of contrast, J. C. Trichet, head of the European Central Bank makes almost $500,000. The head of the Swiss Central Bank makes over $700,000 for pete's sake.

But the most amazing case is that of Hong Kong. The head of their "Central Bank" is Joseph Yam and he makes $1.3 million, about 7 times as much as Helicopter Ben.

People, Hong Kong IS PEGGED TO THE U.S. DOLLAR!!!

Bernanke is literally doing Yam's job while Yam rakes in a cool million plus per annum. I bet he doesn't even give Ben a taste.

In the comments of the previous post, I was accused of being less than forthcoming with photos from our trip to Madagascar last summer. So, I have put up four (count 'em, four!) public galleries on Picassa (247 total photos) of the trip.

I have now risen to the 95%. The Duke loss, and the Missouri win, have me in prettygood shape.

I would like to point out the comment from my previous post:

Anonymous said...

I wish I could imagine a universe where Mizzou can beat Memphis.

3:29 PM

It's not that hard to imagine, actually. Suppose that Mizzou scores 102,and Memphis scores 91. Suppose Mizzou, a pressing team, has an easy time with the Memphis press. Suppose that this happened.

Mizzou over Memphis was actually quite a common pick. To say that you can't imagine a #3 winning over a #2 is a sign that you are bona fide moron. The game wasn't close. The match-ups were such that MANY people thought Mizzou was a good upset pick.

{Inappropriate screed, by me, deleted. My wife assures me I was irrational, and still on aneshesia from my early morning (8-9 am) medical procedure (yes, colonoscopy). So my apologies. The commenter was atually expressing HOPE that Mizzou would win, and I was too stupid to recognize that. Aaargh. How embarrassing.}

Wow. Was Henry Hazlitt blessed with the gift of foresight? Nope. Just economic logic. This from 1946 (from KPC friend and ubermensch Mark Perry)

Government-guaranteed home mortgages, especially when a negligible down payment or no down payment whatever is required, inevitably mean more bad loans than otherwise. They force the general taxpayer to subsidize the bad risks and to defray the losses. They encourage people to “buy” houses that they cannot really afford. They tend eventually to bring about an oversupply of houses as compared with other things. They temporarily overstimulate building, raise the cost of building for everybody (including the buyers of the homes with the guaranteed mortgages), and may mislead the building industry into an eventually costly overexpansion. In brief, in they long run they do not increase overall national production but encourage malinvestment. (my emphasis)

At least compared to the response of the Bank of Japan after their housing bubble burst. Check out this recent article on the subject which contains the following:

"The following graph compares the cumulative growth in the broad money supply of both Japan and the US for the first 14 months after the starts of their respective post-credit crash recessions (April 1992 for Japan and December 2007 for the US):

The difference is quite dramatic. 14 months after Japan's recession began, the Japanese money supply had cumulatively grown by less than 1%. Here in the US, 14 months after the start of our recession, the money supply has already increase by almost 11%."

Q: Mr. President, are you — thank you. Thank you, Mr. President. Are you reconsidering your plan to cut the interest rate deduction for mortgages and for charities? And do you regret having proposed that in the first place?

OBAMA: No, I think it's — I think it's the right thing to do, where we've got to make some difficult choices. Here's what we did with respect to tax policy.

What we said was that, over the last decade, the average worker, the average family have seen their wages and incomes flat. Even in times where supposedly we were in the middle of an economic boom, as a practical matter, their incomes didn't go up. And so, well, we said, Let's give them a tax cut. Let's give them some relief, some help, 95 percent of American families.

Now, for the top 5 percent, they're the ones who typically saw huge gains in their income. I, I fall in that category. And what we've said is, for those folks, let's not renew the Bush tax cuts, so let's go back to the rates that existed back in, during the Clinton era, when wealthy people were still wealthy and doing just fine, and let's look at the, the level at which people can itemize their deductions.

And what we've said is: Let's go back to the rate that existed under Ronald Reagan. People are still going to be able to make charitable contributions. It just means, if you give $100 and you're in this tax bracket, at a certain point, instead of being able to write off 36 percent or 39 percent, you're writing off 28 percent.

Now, if it's really a charitable contribution, I'm assuming that that shouldn't be the determining factor as to whether you're giving that $100 to the homeless shelter down the street.

And so this provision would affect about 1 percent of the American people. They would still get deductions. It's just that they wouldn't be able to write off 39 percent.

In that sense, what it would do is it would equalize. When I give $100, I'd get the same amount of deduction as when some, a bus driver who's making $50,000 a year, or $40,000 a year, gives that same $100. Right now, he gets 28 percent, he gets to write off 28 percent. I get to write off 39 percent. I don't think that's fair.

So I think this was a good idea. I think it is a realistic way for us to raise some revenue from people who've benefited enormously over the last several years.

It's not going to cripple them. They'll still be well-to-do. And, you know, ultimately, if we're going to tackle the serious problems that we've got, then, in some cases, those who are more fortunate are going to have to pay a little bit more.

My favorite parts? First, I love the extremely high bar BHO has set for his policies: "It's not going to cripple them", so what in the world could the fuss be about?

I also like his command of economics: "If it's really a charitable contribution", then the tax treatment really isn't important to the process.

Finally I really like the asymmetric application of fairness. He compares a rich guy to a bus driver making $50,000 and says it's not fair that the rich guy gets a bigger deduction for the same contribution. He seems however to have no problem with the fact that the bus driver is paying less in taxes both overall and as a percentage of his income.

Look people, I know politicians will pretty much say anything to justify what they want to do, I am just a bit surprised at how much of a hack our beloved Obama has become in such a short time.

We use the availability heuristic to estimate the frequency of specific events. For example, how often are people killed by mass murderers? Because higher frequency events are more likely to occur at any given moment, we also use the availability heuristic to estimate the probability that events will occur. For example, what is the probability that I will be killed by a mass murderer tomorrow?

We are especially reliant upon the availability heuristic when we do not have solid evidence from which to base our estimates. For example, what is the probability that the next plane you fly on will crash? The true probability of any particular plane crashing depends on a huge number of factors, most of which you're not aware of and/or don't have reliable data on. What type of plane is it? What time of day is the flight? What is the weather like? What is the safety history of this particular plane? When was the last time the plane was examined for problems? Who did the examination and how thorough was it? Who is flying the plane? How much sleep did they get last night? How old are they? Are they taking any medications? You get the idea.

The chances are excellent that you do not have access to all or even most of the information needed to make accurate estimates for just about anything. Indeed, you probably have little or no data from which to base your estimate. Well, that's not exactly true. In fact, there is one piece that evidence that you always have access to: your memory. Specifically, how easily can you recall previous incidents of the event in question? The easier time we have recalling prior incidents, the greater probability the event has of occurring -- at least as far as our minds are concerned. In a nutshell, this is the availability heuristic.

[...]

Although there are many problems associated with the availability heuristic, perhaps the most concerning one is that it often leads people to lose sight of life's real dangers. Psychologist Gerd Gigerenzer, for example, conducted a fascinating study that showed in the months following September 11, 2001, Americans were less likely to travel by air and more likely to instead travel by car. While it is understandable why Americans would have been fearful of air travel following the incredibly high profile attacks on New York and Washington, the unfortunate result is that Americans died on the highways at alarming rates following 9/11. This is because highway travel is far more dangerous than air travel. More than 40,000 Americans are killed every year on America's roads. Fewer than 1,000 people die in airplane accidents, and even fewer people are killed aboard commercial airlines.

[...]

Consider, for example, that the 2009 budget for homeland security (the folks that protect us from terrorists) will likely be about $50 billion. Don't get us wrong, we like the fact that people are trying to prevent terrorism, but even at its absolute worst, terrorists killed about 3,000 Americans in a single year. And less than 100 Americans are killed by terrorists in most years. By contrast, the budget for the National Highway Traffic Safety Administration (the folks who protect us on the road) is about $1 billion, even though more than 40,000 people will die this year on the nation's roads. In terms of dollars spent per fatality, we fund terrorism prevention at about $17,000,000/fatality (i.e., $50 billion/3,000 fatalities) and accident prevention at about $25,000/fatality (i.e., $1 billion/40,000 fatalities).

We could sure use another lefthanded pitcher. Jaime Garcia has an ERA approaching 6, and NOT as a starter (As Angus is fond of saying, very slowly: "OTHER....PEOPLE's..... RUNS!"). Trever Miller is nearly 36 years old. Royce Ring has given up 16 earned runs, in 6 total innings pitched. That's an ERA well over 20. The only real lefty we've got is Dennis Reyes, who is 32 years old and looks rounder than the 250 he's listed at in the stats. Still, Reyes is a veteran, a solid guy, with a WHIP of 1.5 in nearly 650 total innings pitched. His ERA last year was 2.33; glad to have you, Dennis! Stats, and a video of the chubby one in action.

Anyway, we sure could use another lefthander. A spot starter guy, but mostly to come in and shut down one lefthanded batter in a tough inning. Right now, we have a bunch of guys who just spray gas on the fire.

Mayor Kenneth Foy is on the record as opposing any development on land owned by a person who didn't contribute to his campaign.

During the dust-up at Chapel Hill City Council Meeting (just stop and think what a cluster f**k that meeting has to be...magnificent!), the following was observed by the Raleigh News and Observer reporter:

Georg Vanberg, a political science professor at UNC-Chapel Hill, called out council member Bill Strom for "looking down" and "not paying attention" as he spoke.

Vanberg accused the council of "procedural shenanigans" because Foy required speakers to wait until Ayden Court came up on the meeting agenda rather than allowing them to speak about the development during a public hearing on expanding uses of the high-density zone.

"By your vote, you made anything they said irrelevant," Vanberg said. "People are upset about [taxes], and you guys are doing your best to ruin the fiscal health of this community."

"If you're a political scientist," said Foy, "maybe you ought to inform yourself if you're going to start saying things like that."

IF? IF? Golly, Mayor Foy. I guess I was hoping you had some better rhetorical tactic than questioning someone's professional credentials. Like...a counterargument, something that addressed the claims being made.

But, since you decided to make that play, let's go to the "tale o'the tape" on "iffy" Political Scientist Georg Vanberg:

hmmm....doesn't really LOOK like a political scientist. Handsome, in good physical shape, has most of his hair....Maybe Mayor Foy is on to something!

But, no.

Dr. Georg Vanberg "is an Associate Professor and Co-Director of the Undergraduate Honors Program in the Department of Political Science at the University of North Carolina at Chapel Hill. My research focuses on comparative political institutions. I am particularly interested in constitutional and judicial politics as well as in coalition theory. I teach courses on judicial and constitutional politics, formal modeling, and research design."

That is, he got a PhD at U of Rochester, one of the foremost graduate programs in political science. He is tenured at UNC, again one of the foremost programs in political science. And his c.v. shows broad and deep interests in elections and political economy. Me, I think he is qualified to offer some judgments about a city council meeting and its procedures.

Yup, he's a political scientist all right. If it hadn't been for those meddling kids, and their darned blog, the Mayor would have gotten away with it!

Literally, according to a new NBER working paper by Robinson and Torvik (ungated version here), entitled "The Real Swing Voter's Curse".

"A central idea in political economy is that voters who are not ideologically attached to a political party, so-called ‘swing voters,’ attract policy favors and redistribution because they become the focus of electoral competition. In many parts of the world, however, politicians do not just use carrots to win elections, they also use sticks - coercion and violence. In this paper we show that expanding the ‘policy space’ to incorporate this can completely overturn the predictions of the standard model. The reason for this is simple. With all groups of voters at play, political competition does indeed lead to a chase for the support of swing voters. In equilibrium this enables such voters to extract a large amount of rent from politicians. Anticipating this, politicians have an incentive to use violence to effectively disenfranchise swing voters. Indeed, and surprisingly, we show that it can be more attractive for an incumbent to disenfranchise the swing voters than the core supporters of the opposition. Swing voters are not blessed but cursed."

After developing a model, they go on to argue that something very much like this has been going on in Zimbabwe.

Abstract:Health expenditures as a share of GDP have more than tripled over the last half century. A common conjecture is that this is primarily a consequence of rising real per capita income, which more than doubled over the same period. We investigate this hypothesis empirically by instrumenting for local area income with time-series variation in global oil prices between 1970 and 1990 interacted with cross-sectional variation in the oil reserves across different areas of the Southern United States. This strategy enables us to capture both the partial equilibrium and the local general equilibrium effects of an increase in income on health expenditures. Our central estimate is an income elasticity of 0.7, with an elasticity of 1.1 as the upper end of the 95 percent confidence interval. Point estimates from alternative specifications fall on both sides of our central estimate, but are almost always less than 1. We also present evidence suggesting that there are unlikely to be substantial national or global general equilibrium effects of rising income on health spending, for example through induced innovation. Our overall reading of the evidence is that rising income is unlikely to be a major driver of the rising health share of GDP.

----------------------

Take Two Aspirin And Tweet Me In The Morning: How Twitter, Facebook, AndOther Social Media Are Reshaping Health Care

Carleen HawnHealth Affairs, March/April 2009, Pages 361-368

Abstract:If you want a glimpse of what health care could look like a few years from now, consider "Hello Health," the Brooklyn-based primary care practice that is fast becoming an emblem of modern medicine. A paperless, concierge practice that eschews the limitations of insurance-based medicine, Hello Health is popular and successful, largely because of the powerful and cost-effective communication tools it employs: Web-based social media. Indeed, across the health care industry, from large hospital networks to patient support groups, new media tools like weblogs, instant messaging platforms, video chat, and social networks are reengineering the way doctors and patients interact.

Monday, March 23, 2009

I take some solace in the fact that I am still beating out the Prez. (His bracket)

To his credit, he nailed 14 of the Sweet 16, which got him back some level of respectability.

And, since Baracket Obama and I have the same final four, with the exception of him picking Memphis and me picking Mizzou in the West, this could be close. I have a narrow lead, because he had such a disastrous first round.

It will come down to these games:Memphis v. Mizzou: If Mizzou wins, I am golden. This is the single biggest factor,since I have los tigres in the Final FourDuke v. Villanova: If Villanova can pull this out, it will help me a bit. (No, I did not pick 'Nova to beat Duke. I picked Texas to beat Duke. I would pick the Sisters of Mercy Convent School to beat Duke, this year. I don't see them winning much. I was, I should point out, quite wrong.)

"The Obama administration will call for increased oversight of executive pay at all banks, Wall Street firms and possibly other companies as part of a sweeping plan to overhaul financial regulation, government officials said."

Sunday, March 22, 2009

Obama deficits good ('cause the government will spend the money for us).

(You may think I am distorting the article. I think this is a fair summary. Please read it and make up your own mind)

In fact, speaking of the Obama deficit Frank says "If anything, it may need to be even larger"

And here's Bob on how to pay off the accumulated debt:

"there are many ways to pay down debt without requiring painful sacrifices. A $2 tax on each gallon of gasoline, for example, would generate more than $100 billion in additional revenue a year. Europeans, who pay more than $2 a gallon in gasoline taxes, have adapted by choosing more efficient cars — and they appear no less satisfied with them."